How to shorten the sales cycle (and close deals faster)
Enterprises typically have very long buying cycles. Six months or longer from initial contact to closing a deal are the norm. But there are ways to fast-forward this process and close even large enterprise deals in less time.
Enterprises are typically big buyers, but they're also very slow moving organisations. Deals are worth tens or hundreds of thousands of dollars, but it takes so much time and so many steps to actually get a contract signed. Here are two things you can do to accelerate the sales process.
1. Understand the buying cycle of the enterprise you're selling into
Have a clear vision of their buying journey. What are all the steps that it's going to take to close the deal? Who are all the stakeholders that are going to be involved? Make a list of everything that needs to be accomplished all the way from initial interest to signing the contract and wiring the money.
How do you do that?
You ask the prospect: "What is it going to take for you guys to buy? What are all the steps that we're going to take together to make you become a customer of our product?"
The prospect will then answer something along these lines: "Well, we'll have to get approval from this department, and that, and get buy-in from this stakeholder."
The most common mistake startups make at this point is answering: "Sure! Sounds good!"
Why is that a mistake?
It's a mistake because more often than not, they haven't told you their whole buying cycle yet.
That's why you ask another question: "So once we've done these things that you described, are we in business, or do we still have things to do?"
And then you let them guide you through the virtual close. They will essentially describe a virtual roadmap of all the steps that are required to get the deal closed and their money wired into your account.
Once you have mapped out their buying cycle, you move on to the next step.
2. Parallelize processes
Find out which of these steps you can go through in parallel. So rather than doing step 1, then 2, then 3, 4, 5 etc., you try to find opportunities for steps you can already take, while other steps aren't completed yet. Maybe you can already get started on step 5, while you're still working with them on getting step 2 accomplished.
Most companies go through the sales cycle sequentially. That's fine. But if you want speed, you split the cycle up into several threads that run in parallel.
Here's an example
This is what a typical enterprise sales cycle looks like (extremely simplified, just to illustrate the principle):
- You work on getting green-lighted by the various stakeholders.
- Once that is achieved, you then have to talk with their procurement department, which specializes in purchasing from outside vendors.
- And then you often still have to go through legal, and deal with all the contracting issues, and it's a long back-and-forth between your legal department and their legal department before the contracts get approved by their legal department.
Rather than doing this one step after the other, get started on these three threads simultaneously.
Here's what you say
When you're talking to the prospect and it seems like this is a highly probable opportunity, you tell them:
"After our initial call, it seems that this would be a great fit.
Now we know that we're going to have to take all these different steps and talk to all these different departments and stakeholders to make sure that the entire organization is on board and you guys are ready to rock'n'roll.
We've had really good experiences once we've established that somebody is a great fit. Most of the time, we're going to be able to make the deal happen. We're going to work with you and make it happen.
In order to make it happen even smoother and faster, what we would appreciate is if you could put us in touch with your procurement and your legal department now, so we can start that process in parallel, so by the time we have approval from all the different stakeholders, we're ready to rock'n'roll. We're not going to be slowed down by things that need to be done by procurement and legal.
Does that sound fair?"
Nine out of ten times people will say, "Yeah, that actually sounds like a really good idea." And they're going to put you in touch with procurement and legal, and you can start the process even ahead of the final agreements.
This can cut weeks and even months off their buying cycle.
And every day you save time this way is making your life, and the customer's life better, and it helps you become a more profitable, faster-growing company.
Want more of my best advice on selling to the enterprise? Claim a free copy of my book Enterprise Sales For Startups!